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Chambliss, Isakson Praise Senate Commerce Committee for Scheduling Hearing on Impact of Airline Mergers

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Location: Washington, DC


Chambliss, Isakson Praise Senate Commerce Committee for Scheduling Hearing on Impact of Airline Mergers

Senators Renew Opposition to U.S. Airways Bid For Delta Air Lines

U.S. Senators Saxby Chambliss (R-Ga.) and Johnny Isakson (R-Ga.) today praised the Senate Committee on Commerce, Science and Transportation, which announced it will hold a full committee hearing on the potential impact of airline mergers, including a proposed bid by U.S. Airways to merge with Atlanta-based Delta Air Lines. The Georgia senators also renewed their opposition to the proposed merger.

On Dec. 12, 2006, Chambliss and Isakson sent a letter to the chairman and ranking member of the Senate Committee on Commerce, Science and Transportation asking them to hold hearings on the impact of the U.S. Airways proposal. In the letter, Isakson and Chambliss outlined the reasons why the proposed bid is not in the best interest of the nation, the economy or the consumer.

"For more than 60 years, Delta Air Lines has thrived as a leading employer of countless Georgians and has established itself as an economic engine for the Southeast," said Chambliss. "Delta has met its challenges head-on and these hard-working folks deserve the opportunity to follow through with their plans to emerge as an independent company. I am pleased that my colleagues on the Senate Commerce Committee have scheduled this hearing to ensure that the content and potential effects of this proposal are carefully examined."

"In our fragile aviation system, it is critical to understand that competition is still in the best interests of the American consumer. I firmly believe this proposed merger bid and the potential further consolidation of the airline industry is a threat to competition, to secondary market service and to lower consumer prices," Isakson said. "Delta has worked hard to develop a plan to exit bankruptcy and deserves the chance to emerge in 2007 as a strong, stand-alone carrier."

Chambliss and Isakson believe the overlay of routes of Delta Air Lines and U.S. Airways will result in massive duplications followed by massive reductions in service, especially to small cities in the Southeast. The elimination of competition, they believe, will force prices to go up and service to go down.

Chambliss and Isakson also have significant doubts that a merged company would honor the promise to preserve Delta employees' already-earned pensions. While Delta has worked extensively in the bankruptcy process to honor benefits already earned, U.S. Airways chose to abandon its employee pension plans to the Pension Benefit Guarantee Corporation rather than fund its $5 billion pension obligation. However, U.S. Airways has found $5 billion to fund its unsolicited proposal to merge with Delta.

The hearing is scheduled to take place on Wednesday, January 24, 2007 at 10:00 a.m. in room 253 of the Russell Senate Office Building.

http://chambliss.senate.gov/public/index.cfm?FuseAction=NewsCenter.PressReleases&ContentRecord_id=11a85ac4-802a-23ad-41f8-d560a9a794a4&Region_id=&Issue_id=&CFID=4175608&CFTOKEN=40932828

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